Why Owning a Home Is Important

By Mike Grundon

Owning a home is more than just hype; it’s the gateway to long-term and short-term financial success. Long-term, you’ll build an equity nest egg and short-term, you’ll be able to enjoy potential tax breaks and pay yourself instead of a landlord. A home purchase is an investment you’ll be glad you made!

Owning a home can make a huge difference for your financial future, especially for a first-time homebuyer. While buying a home can be a transformative experience for you personally, homeownership can help you financially as well. Homeownership can lead to building your personal wealth due to home equity, or fair market value, which will likely increase over time based on both the market and any renovations you make to your home.



San Diego is one of the top ten cities in the country that millennials are moving to. It is a particularly great place to buy a home because of its warm weather climate, proximity to the ocean and large, thriving industries, including a strong biotech presence and several large universities. Couple that with a bevy of fun and eclectic neighborhoods with wonderful restaurant and activity options, and it’s easy to see why you would choose to purchase a home in San Diego.

Renting in San Diego, on the other hand, can be expensive, and there are few options available. There is a lower vacancy rate in San Diego apartments than the national average and rents are rising faster than wages. This combination creates a difficult market for renters because the high demand and limited supply of rentals available drive up costs. If you can afford to buy a home, turning the cash that you would be spending on rent into payments on a mortgage can make a major difference in your long-term financial stability.

There are many reasons owning a home is important, and most of them stem from the fact that a home is an asset and paying a mortgage increases your equity in that asset, which is better than paying rent. A potential increase in your credit score, tax benefits and anticipated growth in the housing market are additional benefits to having a mortgage.

Having a mortgage can help improve your credit score because a home loan adds diversity to your credit profile. Even though a mortgage is a debt, it is “good” debt, because it is tied to an asset (the house). The largest portion of your credit score is determined by your payment history, and making payments on a long-term loan like a mortgage positively contributes to your payment history. As long as you make your payments on time, your mortgage can improve your credit score by increasing your reputation as a responsible borrower.

Owning a home that you can afford carries tax benefits, too. The IRS allows you to deduct the interest on your mortgage from your income taxes, as well as some closing costs and annual property taxes. Tax incentives like these help homeowners build wealth.

The house that you buy is an asset that can go up in value over time. San Diego has long been an attractive real estate market because of geographical advantages like good weather, scenic beaches and its status as a port city. Because it features the second largest millennial population per capita in the United States’ major cities, San Diego is poised to continue to grow. San Diego’s strong business presence, young population and desirable location have strongly factored into San Diego’s home values, which continue to be on the rise.

Buying a house requires planning, including finding out how much house you can afford, what type of loans are available and what the fees are. Mission Fed’s first-time homebuyer infographic can shed some light on what you need to do to purchase a home. Our handy Home Loan Calculator can help you figure out what you can afford by calculating monthly payments based on loan amounts, interest rates and points. You can use our Down Payment Calculator to estimate how much you should put down on your loan upfront or to calculate the amount of interest you can expect to pay over the life of your loan based on your down payment.

Homeownership is a journey that requires a lot of information and support, and Mission Fed is happy to provide both. Once you feel ready to apply for a mortgage, you can use our fast and easy online application to start the process of getting a Mortgage Loan. And once you click “send,” you’ll be minutes away from beginning the exciting transition from home renter to homeowner!

Credits: Mike Grundon | Mission Federal Credit Union